Expect big changes in the budget, says Lancashire tax expert

By MHA

16 Oct 2024

Website
Tony Medcalf_Press.jpg.jpg

Individuals and businesses should expect to see a major shake up of the tax system when the government announces the budget later this month, according to a leading regional advisor.

Tony Medcalf, tax partner at accountancy and business advisory firm at MHA, believes changes to inheritance tax, capital gains tax and fuel duty are all possible when chancellor Rachel Reeves delivers her first budget on October 30.

Tony, who has advised businesses and individuals on tax matters for 30 years, said: “The biggest shifts on tax and spending policy are generally taken in a new government’s first budget and Labour has been setting the scene for tax rises in recent weeks.

“There’s definitely a tricky balancing act for the new prime minister and chancellor to make changes without jeopardising business and consumer confidence.

"They may have boxed themselves into a corner on tax rises because of pre-election manifesto pledges not to increase the headline rates for income tax, employee national insurance, and VAT. 

“With an increase corporation tax rate also seemingly ruled out in the manifesto, what’s likely to happen is a lot of smaller changes to the tax system. While Labour says it won’t increase employee national insurance contributions, raising employer contributions is an option that remains open to them.” 

Talking about some of the measures that could be introduced in the budget, Tony added: “We know Labour plans to impose VAT on private school fees and close the ‘non-dom’ tax loophole and I’m sure we’ll get more detail on these measures. It looks likely that the chancellor may also propose reducing tax relief on pension contributions for higher earners. 

“A reversal of the Conservatives’ previous 5p cut to fuel duty seems almost inevitable. It’s been 14 years since there was an increase to fuel duty, but with petrol prices having fallen in recent months now may be an opportune time for Labour to do it.

“We also know the chancellor is planning to make assets held in offshore trusts liable for inheritance tax. Changes are also proposed for the taxation of carried interest on private equity deals, which is currently taxed at the lower capital gains tax rates, rather than income tax rates. 

“But these measures aren’t going to be enough on their own to close such a big shortfall in the public finances, which is why I think there’s a possibility of something more fundamental on both inheritance and capital gains tax.”

As well as changes to tax, the government is also expected to use the budget to outline how it intends to stimulate economic growth.

Tony added: “It looks like the government wants to have more state-managed instruments overseeing investment in infrastructure.

"It’s a strategy that involves bringing in the private sector to invest public money, but with government remaining in control of how that money is spent. The plan to create GB Energy is an example of this. 

“It’s as yet unclear what support there may be for SMEs in the budget. Owner-managed businesses are the lifeblood of the economy in terms of output and employment, so I would like to see something that encourages enterprise and investment. Hopefully, Labour won’t tinker with the current full expensing on capital allowances.

"As a tax advisor, I’m curious to see what the government will announce this time as there has been very little in the way of major tax changes over the last few years. What we can expect is a fundamental shift in this budget.

“The thing that businesses crave most of all is certainty, so I believe that once everyone knows what the landscape will be, people will start making decisions and investing again.”

Enjoyed this? Read more from MHA

Latest news

1

Investment drives growth plan at CoolKit Coolkit Vans

Investment drives growth plan at CoolKit

11 Jul 2025

2

Story Homes submits plans for 140 new homes in Longton Story Homes plans

Story Homes submits plans for 140 new homes in Longton

11 Jul 2025

3

University of Lancashire climbs 14 places in student positivity survey Happy students at ULAN

University of Lancashire climbs 14 places in student positivity survey

10 Jul 2025

4

Forbes Solicitors achieves strong growth and promotes 15 Forbes Solicitors promotions

Forbes Solicitors achieves strong growth and promotes 15

10 Jul 2025

5

Communications company raises investment will fuel global expansion Laurence Tan (Investment Associate, Praetura Ventures); Charlie Morris (Director, Corporate Finance (Mergers & Acquisitions); Ian Rose (Chairman, Audiebant); Josh Dean (CEO, Audiebant); Peter Carway (Investment Director, Praetura Ventures)

Communications company raises investment will fuel global expansion

10 Jul 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
LBV123 July/August Launch Event
Lancashire Business View magazine launch
Networking
16 Jul 2025

LBV123 July/August Launch Event

Burnley College University Courses Building, Burnley, BB12 0AN

08:30 - 10:30

Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

Shaping Preston's future by remembering its past
1750160034867.png.png
LBV Hub Networking
16 Jul 2025 - 16 Jul 2025

Shaping Preston's future by remembering its past

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 20:30

Chamber Summer BBQ
LBV Hub Social
17 Jul 2025 - 17 Jul 2025

Chamber Summer BBQ

The Borough, Dalton Square, Lancaster, LA1 1PP

17:30 - 20:00

Preston Tech Connection: Web3 is Dead. Or is It?
July Longer Banner.jpg.jpg
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Web3 is Dead. Or is It?

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Cumbria Business Expo 2025
https---cdn.evbuc.com-images-880461633-4862066883-1-original.20241022-110415.jpeg.jpg
LBV Hub Exhibitions
19 Sep 2025 - 19 Sep 2025

Cumbria Business Expo 2025

Carlisle Racecourse, Carlisle, CA2 4TS

09:00 - 15:00

North West Business Expo 2025
https---cdn.evbuc.com-images-880456273-4862066883-1-original.20241022-105445.jpeg.jpg
LBV Hub Exhibitions
24 Oct 2025 - 24 Oct 2025

North West Business Expo 2025

Bolton Stadium Hotel, Bolton, BL6 6SF

09:00 - 15:00

Lancashire Business Day 2025
241122lbvlancashiredaylhp0647web
Networking
27 Nov 2025

Lancashire Business Day 2025

Burnley FC , Burnley, BB10 4BX

12:00 - 17:00

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV122 Online Graphic
Subscribe now

Weekly news bulletin